A rebate is one of the income tax provisions that help taxpayers reduce their tax liability. Taxpayers earning an income under a certain limit have the benefit of paying marginally lower taxes. Let’s know the rebate available under section 87A in detail: Eligibility to claim rebate u/s 87A You can claim the benefit of...
Continue readingResidential Status
Residential Status for Income Tax – Individuals & Residents The Income Tax Department needs to determine the residential status of an individual or company. It becomes particularly important during the tax filing season. This is one of the factors based on which a person’s taxability is decided. Let us examine the residential status and...
Continue readingBasics of Income Tax
Administration of income tax Ministry of Finance Department of Revenue CBDT Assessing Officers Commissioners Charging Section – Section 4 Section 4 of the Income-tax Act is the charging section which states that: The tax shall be charged at the rates prescribed, for the year, by the annual Finance Act. The charge is on every...
Continue readingLeave Encashment
Concept of Leave Encashment Every salaried person as per labor law is entitled to at least a minimum number of paid leave every year. However, an individual employee doesn’t need to utilize all the leave he is entitled to a year. In actuality, most employers allow the employees the option of carrying forward such...
Continue readingDetailed Explanation of Cost Inflation Index
Prices of goods rise over the period resulting in a reduction in the purchasing power of money. For example -If 2 units of goods could be bought for Rs.100 today, tomorrow only 1 unit might be available for Rs. 100 due to increasing inflation. CII is used for calculating the estimated increase in the...
Continue readingTDS on Non-Residents- Section 195
Tax Deducted at Source for the non-resident people of India is governed by section 195 of the Income Tax Act, 1961. This section highlights the tax rates and deductions related to all business transactions. According to this section, the income is chargeable under the Income Tax Act and the certificate for remittance is mandatory....
Continue readingMinimum Alternative Tax
Minimum Alternative Tax is payable by the companies under the Income Tax Act 1961. MAT was introduced with a view to target companies that make huge profits and pay dividends to their shareholders but at the same time pay no or minimal tax under the normal provisions of the Income Tax Act, 1961 by...
Continue readingTaxation of Charitable/Religious Trust
Charitable trusts are the trusts which are formed charitable purposes like- to provide relief to poor, medical relief, education, preservation of environment/ monuments, the advancement of objects of general public utility, religious purpose, etc. Their taxation has always been a subject of concern. The income of such trust is taxed as per the provisions...
Continue readingHow to File Income Tax Return Using Form 16
Form 16 is a certificate issued under sec 203 of Income Tax Act for TDS (tax deduction at source) from salary. Form 16 shows a detailed record of tax deducted by the employer from the salary of the employees. Form16 includes complete details of salary, its components paid by the employer as well as...
Continue readingPPF Scheme
PPF Scheme is very common among the investors or financial advisors for its flexible nature. Also, the tax benefits one can avail from a Public Provident Fund scheme make the plan fruitful. To motivate small investments among the people, the Ministry of Finance, Govt. of India initiated the PPF (Public Provident Fund) in the...
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